APPLICATION PROCEDURES & CRITERIA FOR FINANCING FOREST PLANTATION PROJECT
APPLICATION PROCEDURES AND CRITERIA FOR
FINANCING FOREST PLANTATION PROJECT
MINISTRY OF PLANTATION INDUSTRIES AND
COMMODITIES, MALAYSIA
CRITERIA OF ELIGIBILITY TO OBTAIN FINANCING UNDER THE FOREST
PLANTATION DEVELOPMENT PROGRAMME BY STATE
GOVERNMENT/GOVERNMENT AGENCIES/GOVERNMENT
COMPANIES/GLC AND PRIVATE COMPANIES
Application to obtain financing assistance in the form of soft loan is through the
Malaysian Timber Industry Board (MTIB) that will be subjected to normal application
procedures and the following criteria:
a.
Companies need to develop the forest plantation only with recommended
species by the Technical Committee on Forest Plantation Development under
the Ministry of Plantation Industries and Commodities as follows:
Region
Peninsular
Malaysia
Main Species
Additional Species
1. Rubberwood
1. Khaya
2. Acacia spp.
2. Teak
3. Sentang
Sabah
1. Rubberwood
1. Kelempayan/Laran
2. Acacia spp.
2. Batai
3. Teak
Sarawak
1. Rubberwood
1.Kelempayan/Laran
2. Acacia spp.
2. Batai
3. Binuang
4. Khaya
b.
The public listed company should be Malaysian-owned with 51% local equity
and non-public listed company to be with 100% local equity and registered
under the Companies Act 1965;
c.
The company must have a minimum paid-up capital of at least RM500,000;
d.
Having land ownership or have at least a 30 years leasehold agreement with
minimum size of:
• 2,500 hectares for rubberwood species and 15,000 hectares for Acacia
and other timber species for 15-year cycle (Peninsula Malaysia only);
•
15,000 hectares for rubberwood species, Acacia and other timber
species for 15-year cycle for Sabah and Sarawak
(Please attach the related land title and leasehold agreement);
e.
Peninsula Malaysia: Forest plantation to be developed must be on
statelands or alienated lands and not on Permanent Reserved Forests
(PRFs) that are gazetted for conservation and water catchments area.
Sarawak: Only areas with License for Planted Forest (LPF).
Sabah: Only areas that are approved as zone for Industrial Tree Plantation
(ITP) under the Sustainable Forest Management Licence Agreement
(SFMLA);
f.
The company must have sufficient planting materials for the forest plantation
that are approved by the Malaysian Rubber Board (MRB) for rubber clones
and Forest Research Institute of Malaysia (FRIM) for other wood hybrid and
clones;
g.
The company must be able to provide financing at least 20% from the cost of
the proposed project;
h.
The land for forest plantation must be free from other crops such as palm oil
and cocoa and the fund is for the new planting of timber species approved by
the Technical Committee only;
i. The company should prove to be financially strong with satisfactory and
reasonable cash-flow indicating capability for loan repayment; and
j.
Companies should not have any adverse record of borrowing from any financial
institutions or government agencies
SUCCESSFUL APPLICANTS WILL BE OFFERED THE LOAN WITH THE
FOLLOWING TERMS:
a. Interest rate of 3%;
b. Loan Period: 20 years;
c. Grace period of 15 years (with yearly compounded interest rate); and
d. Payback period of 5 years beginning on year 16 (with daily compounded
interest rate).
DOCUMENTS NEEDED TO BE SUBMITED:
1. Application Letter
2. Company Profile
3. Working Paper of the Proposed Project (See format in Annex 1)
4. Copies of Form 9, 24 and 49 under the Company Act (to be verified)
5. A copy of Memorandum Article of Association (to be verified)
6. A copy of Land Title [Ownership] (to be verified)
7. Company’s Organisation Chart (Forest Plantation Management Division)
ANNEX 1
FORMAT OF WORKING PAPER TO FINANCING
THE PROPOSED PROJECT
(i).
Objective and Scope of the Project;
(ii).
Background of the Project;
(iii).
Project Location and Hectarage (Attach map of the project);
(iv).
Project Details including spesis of timber to be planted;
(v).
Prospect of the project;
(vi).
Implementation Plan (Date to begin and end of the project/ Planting
Schedule);
(vii).
Project Costs (List all items and costs in detail);
(viii). Project financing (Percentage of financing needed and companyowned financing);
(ix).
Marketing proposal for the timber production (for own use or to be sold
elsewhere);
(x).
Project cash flow for 15-year period; and
(xi).
Company Financial Statement (to be verified).
ALL RELEVENT DOCUMENTS NEED TO BE SENT TO THE
FOLLOWING ADDRESS:
Director General,
Malaysian Timber Industry Board (MTIB),
Forest Plantation Division,
13-17th Floor, Menara PGRM,
No.8, Jalan Pudu Ulu, Cheras,
P.O.Box 10887,
50728 KUALA LUMPUR.
(up: Puan Hajjah Mahani Mohd Yusoff )
Tel: 03-92822235
Fax: 03-92851477
Prosidur & Kriteria Permohonan Pembiayaan Projek Ldg Hutan (BI) (7.3.08) /cta